While oil supplies in the absence of political disruptions are presently adequate to satisfy global demand, recent assessments of remaining oil reserves show the world will soon face a relentless oil-supply crisis. Within the next fifteen years, worldwide production of conventional crude oil is projected to peak and decline irreversibly. Alternative sources for petroleum products will then be critical.
As depicted in Figure 1, when petroleum sources are expanded to include heavy hydrocarbons, which include both heavy crude oil and natural bitumen, the outlook for domestic oil supplies is much improved.

Worldwide deposits of heavy hydrocarbons are estimated to total almost 5½ trillion barrels, and four-fifths of these deposits are in the Western Hemisphere. [1]


Sagd Technology


Advances in oil production technology are making the production of heavy hydrocarbons a commercial reality. At present, most of the commercial production of heavy oil and bitumen employ some variation of steam injection.

Injecting steam into a heavy-hydrocarbon deposit can be effective in two ways:

  1. The viscosities of all hydrocarbons are greatly reduced as the temperature of the hydrocarbon increases. Therefore, as injected steam raises the temperature of a reservoir, any hydrocarbon liquid within the reservoir will flow more easily.


  1. If injected steam heats a reservoir to sufficiently high temperatures, the heavy hydrocarbons within the reservoir will break down (or “convert”) into lighter hydrocarbons. This process is designated in situ conversion. With sufficient in situ conversion, the hydrocarbons produced at the surface will have characteristics similar to conventional crude oil.


The most advanced production technology using steam is steam-assisted gravity drainage, commonly termed SAGD. In its most sophisticated configuration, SAGD utilizes multilateral horizontal wells, as illustrated in Figure 2.One set of wells is used to inject steam, which rises through the heavy oil or bitumen in the reservoir.

The steam heats the heavy hydrocarbon, reducing its viscosity so it drains under the influence of gravity into a second set of production wells that are situated below the injection wells near the bottom of the hydrocarbon-bearing formation.At present, the vast majority of SAGD projects are in Canada.